A Cross-cultural Perspective On The Role Of Guanxi And Its Related Aspects In Sino-Australian Sales Negotiation

With the trend of globalization and trade liberalization, the trade volume betweenChina and Australia is increasing steadily. Based on this fact, Sino-Australian salesnegotiations happen more and more frequently, but not much research has been done inthis area. Since China and Australia have totally different cultures, Chinese and Australianbusiness people behave differently in the sales negotiating table. This thesis explores therole of guanxi and its related aspects in Sino-Australian sales negotiation from across-cultural perspective.The author conducted relevant research in Shanghai. He collected81copies ofquestionnaires from both native Chinese and Australian sales people who work inShanghai and also interviewed13people (both Chinese and Australians) who haveexperiences in Sino-Australian sales negotiation. Four hypotheses were developed mainlybased on Trompenaars’ cultural dimensions. According to the research findings,Hypothesis One to Three could basically be confirmed while Hypothesis Four could not befully confirmed.Based on H1, it was found that in sales negotiations, Chinese businessmen are verysensitive to guanxi (relationships) while their Australian partners pay more attention tocontract.According to H2, it was found that in sales negotiations, when building xinren (trust),Chinese businessmen value affect-based trust (the emotional connections with the otherparty) while Australian businessmen value cognition-based trust (the other party’scompetence).In terms of H3, it was found that in sales negotiations, Chinese businessmen paymuch more attention to mianzi (face) than do their Australian counterparts and issues thatcause Chinese businessmen to lose face can lead to the failure of the negotiation.H4can not be fully confirmed, but it was still found that in sales negotiations withChinese, if one provides them with renqing (personal favor that show human care), thesewill lead to huibo (reciprocity), which helps pave the way for a good deal. Despite the fact,the influence of renqing is decreasing in Chinese sales negotiation nowadays. From anAustralian perspective, renqing does not work in the sales negotiation because it is againstthe law.